# Point and Figure Charts

Are you waiting for a stock to break out to the upside so you can add it to your portfolio? Point & Figure (P\&F) charts make it easier to visualize breakouts and give you more confidence in making investment or trading decisions. 

## P\&F Charts In a Nutshell

If you're accustomed to using bar or candlestick charts, P\&F charts may look unusual with their X and O columns. However, once you understand them, they can be used as a confirming or complementary chart type.

One of the first aspects you’ll notice about P\&F charts—besides the X and O columns—is that there’s no time on the x-axis, unlike the traditional bar or candlestick charts. But as you become more familiar with P\&F charts, you’ll get a feel for how the charts can be more precise than other chart types. P\&F charts are especially helpful in identifying support and resistance levels and recognizing breakouts and trend signals.

## Using P\&F Charts To Identify Breakouts 

The P\&F chart below is overlaid with trendlines. This makes it easy to identify where price broke out of a downward-sloping trendline. After the breakout, there was a long X-column, indicating price continued increasing. That would have been an ideal time to enter a long position. Missed that opportunity? There could be another one if there's an upside breakout in the prevailing X column.

<figure><img src="https://436553459-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FERtrZrZOhufFzk6ZQO4B%2Fuploads%2F7YWnUhTje1NWIw98Hyrl%2FPnf-intro.png?alt=media&#x26;token=f576839f-ee23-4731-9abf-551ef1cd21d5" alt="P&#x26;F chart from StockCharts.com showing a trendline breakout" width="563"><figcaption><p>P&#x26;F chart showing a trendline breakout.</p></figcaption></figure>

P\&F charts are also flexible because you can change box values and the number of boxes required for a reversal. This can be changed depending on the security you’re analyzing. Make them more sensitive or less sensitive, depending on the security you’re analyzing or the time frame you’re using.&#x20;

Like other chart types, there are many ways to apply P\&F charts to your analysis. A good starting place is to understand the basics.&#x20;